Nov 15, 2022
Steve Cohen’s Point72 Weighs Limit on Investor Redemptions
(Bloomberg) -- Steve Cohen’s Point72 Asset Management is considering putting a gate on investor cash to lock up client capital for longer, emulating other big hedge funds.
The firm is discussing limiting collective client withdrawals to 8.3% per quarter, according to people with knowledge of the matter. Until now, there have been no limits on fund-level redemptions. Point72 had $26 billion under management as of July.
A representative for the Stamford, Connecticut-based firm declined to comment.
Point72 would join other multistrategy hedge funds that have shifted toward longer-term capital in recent years. It now takes investors five years to pull all their cash from Izzy Englander’s Millennium Management, and four years to fully redeem from Ken Griffin’s Citadel.
Stickier capital helps firms invest in technology and infrastructure, as well as recruit and retain talent. And as more hedge funds make the shift, those that don’t risk becoming liquidity sources when investors need cash.
If Point72 goes ahead with the fund-level gate, it may impact existing investor-level terms that allow individual clients to redeem 25% of invested cash each quarter. If clients have collectively reached the 8.3% threshold in a quarter, individual investors won’t be pull more funds that period.
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